We stayed at Hotel Paella Principe in May 2008. We had been driving all day and expected to sleep in Madrid, but all hotel were fully booked. As our intention was to drive to El Escorial the next day, we decided to call an hotel there and see if there were any rooms available. They had, and there we went.
The hotel was right opposite the monastery of San Lorenzo de El Escorial, in the town's centre. We had a magnificent view of the monastery from our rooms (at the back of the hotel). We paid 60 euros (VAT included) for a double room. They were spacious ,clean and modern, both with mini-fridges.
We had dinner at the excellent Paella Principe's restaurant, on the ground floor. We were very pleased with the quality of our meals and the customer service. Breakfast was not included but could be taken at the same hotel for 3 euros.